Explaining the Principled Exception to Privity of Contract
McGill Law Journal
The author contends that the Supreme Court of Canada was right in creating the "principled exception" to privity of contract in its decisions in London Drugs and Fraser River but not for the reasons given in those decisions. Neither the "intentions of the parties" nor "commercial reality" can explain the central features of the principled exception. Similarly, theories of subrogation and voluntary assumption of risk are also incapable of deciphering the limits imposed. Instead, the author maintains that the principled exception is merely an application of conventional estoppel to the facts found in London Drugs and Fraser Rivet" (and other similar privity cases). As such, the author contends that, though the doctrine created by the Supreme Court is principled, it is not in any way a true exception to privity of contract.